Legal Fundamentals

for Canadian Business

Fourth Edition

Chapter 2
Torts and
Professional
Liability
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 Learning Objectives
• Define and differentiate a tort from a crime
• Identify several types of intentional torts
• List the elements required to establish negligent
conduct
• Outline defences available to alleged tort

(Continued)

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 Learning Objectives
(Continued)

• Consider the significance of finding a duty of care

• Trace the development of law related to product
liability
• Apply tort principles to professional conduct
• Identify a number of business-related torts

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 Tort
• Private or civil court action where the injured
party sues wrongdoer for compensation for
wrongful conduct
• In criminal matters, society (through a crown
prosecutor) brings the action to punish the
offender
• Wrongful conduct may be both a crime and a tort

(Continued)

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 Tort
(Continued)

• Contract actions are brought by a party because

the agreement has been breached
• Employers are vicariously liable for all torts
committed by employees during the course of
their employment
– While doing what employed to do

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 Intentional Torts
• Must be a deliberate act
• Need only intend the conduct, not the results
• If conduct is accidental, it would be negligence,
rather than an intentional tort

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 Assault and Battery
• An intentional tort
• Intentional physical interference with another
person
• Some forms of assault and battery may also be
criminal offences

(Continued)

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 Assault and Battery
(Continued)

• Assault
– Threat to harm another (from victim’s perception)
• Must be immediate
• Must be physically possible to carry out
• Need not be harmful, just unwanted
– Intentional
– Physical contact not required

(Continued)

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 Assault and Battery
(Continued)

• Battery
– Intentional
– Unwanted
– Involves physical contact
• Even if contact is beneficial (such as medical treatment), if it is
unwanted, it is still battery

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 Defences to Assault and Battery
• Consent
– Must be informed consent
– Conduct must not exceed consent
• Self-defence
– May use reasonable force in response
– Must be in response to immediate threat

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 False Imprisonment
• Unlawful restraint
– May be physical
– May be simply compliance if victim thinks there is no
choice
• Arrest by private citizen when no crime has taken
place

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 Trespass
• Coming onto another’s property without
permission or authority
– Mistake as to property line is no defence
– If permission revoked, must give person opportunity to
leave
• If refusal, may eject using reasonable force
• Intentional
– Need only intend the activity

(Continued)

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 Trespass
(Continued)

• Damage not required

• Duty to trespassers minimal, but greater if a child
• Indirect trespass – throwing something onto
another’s property
• Continuing trespass – building, fence, etc.
• Only defence for trespass: Intruder had no control
over where he/she was

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 Nuisance
• Private nuisance
– Using your property so as to substantially interfere with
your neighbour’s use of his/her property
– Must be inappropriate use of your property
– Interference must have been reasonably foreseeable
– Remedies: damages or an injunction

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 Defamation
• Derogatory false statement to detriment of a
person, company, or product
• Libel – written defamation
– Also includes broadcasted defamation
• Slander – spoken defamation
• May involve innuendo

(Continued)

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 Defamation
(Continued)

• Must refer to the plaintiff

• Must be published
– Communicated to a third party
• Mistake is no defence
• Libel may also be criminal
• Internet communications now an important cause
of defamation actions

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 Defences to Defamation
• Justification
– Substantially true
– Defendant must prove statement was true
• Absolute privilege
– Statements made on floor of legislature or Parliament,
in senior government committees, or while giving
testimony in trial

(Continued)

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 Defences to Defamation
(Continued)

• Qualified privilege
– If statement made pursuant to a duty, person cannot be
sued if it turns out to be false
– Allowed if person who made statement thought it was
true, made statement without malice, and only
communicated it to those with need to know

(Continued)

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 Defences to Defamation
(Continued)

• Fair comment and Responsible Communication

– Defences used mostly by the media
– Fair Comment is expression of opinion about public
figures, works, etc.
– Must be based on true facts known to public
– Must be made without malice
– Responsible Communication protects media if
reasonable diligence used to verify facts even if facts
turn out not to be true

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 Summary

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 Negligence
• Involves inadvertent or careless conduct causing
injury or loss to another
– Duty of care must exist
– Conduct must fall below standard of care
– Injury or loss must result from conduct
• Reasonable person test
– Behaviour that is higher than average, but less than
perfect

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 Duty of Care
• Reasonable foreseeability test
– Duty of care owed to anyone we can reasonably foresee
would be harmed by what we do
– Donoghue v. Stevenson established test to determine if
duty of care is owed
– Anns case led to two-stage test
• Degree of proximity between parties
• Reasons to allow court to modify nature of duty

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 Standard of Care
• Required standard of care is determined by
reasonable person test
• Level of risk, cost, and potential loss are important
factors to be considered
• Experts held to standard of a reasonable person in
their profession

(Continued)

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 Standard of Care
(Continued)

• Circumstantial evidence may lead to finding of

negligence
• Special standards may be set by statute
– Occupiers’ liability acts
– Innkeepers
– Common carriers
• Insurance to avoid risks of tort liability

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 Causation and Damage
• Conduct complained of was cause of injury or
damages

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 Defences to Negligence
• Contributory negligence
– If plaintiff contributed to own loss, he/she must bear
some responsibility
– Most jurisdictions have a Contributory Negligence Act,
allowing courts to assign proportional liability

(Continued)

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 Defences to Negligence
(Continued)

• Voluntary assumption of risk

– Deliberately putting oneself in harm’s way disqualifies
one from suing for injury or loss that results
– Plaintiff has assumed both physical risk of activity as
well as legal risks
– Must be clear that plaintiff absolved the other party of
responsibility; very difficult to prove

(Continued)

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 Defences to Negligence
(Continued)

• Remoteness
– Mustapha case
– Must determine whether a particular injury was
reasonably foreseeable
– If connection between the conduct and injury was too
indirect or unexpected, no liability will be imposed
– If legal causal connection is found, victims must be
fully compensated, even if more vulnerable to loss than
usual

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 Product Liability
• Must show defendant failed to live up to standard
of reasonable manufacturer
• May use prima facie case of negligence
(circumstantial evidence)
• In some jurisdictions, manufacturer has increased
liability through statute

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 Professional Liability
• Duty of care to third parties who rely on work of
professionals and are caused loss as a result
• Formerly claims required party to suffer some
manner of physical loss or damage
• However, since the decision of Haig v. Bamford
claims allow recovery for pure economic loss

(Continued)

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 Professional Liability
(Continued)

• Anns case is test for new or unique situations

where duty of care must be determined
– Degree of proximity between the parties
– Any reason to allow court to modify (or not impose) the
duty or limit the class to whom duty is owed

(Continued)

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 Professional Liability
(Continued)

• Professional expected to have degree of expertise

of a reasonable professional in that field
• Inexperience is no defence
• Standard practice of the profession may not be
enough

(Continued)

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 Professional Liability
(Continued)

• Fiduciary duty – duty to act in best interests of

client
– Involves loyalty and good faith
– All funds are held in trust
• Subject to rules of professional associations
• Liability insurance may reduce risk
• Negligence may also be criminal

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 Other Business Torts
• Fraud or deceit
– Intentionally misleading another
• Injurious falsehood or product defamation
– Spreading false information about a product
• Inducing breach of contract
– Employer “stealing” an employee from a competitor

(Continued)

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 Other Business Torts
(Continued)

• Passing off
– Misleading public by using similar name, logo, etc.
• Trespass to chattels
– Damaging or interfering with personal property
• Conversion
– Taking property of another
• Privacy violations
– May be regulatory or tort by statute

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